Audit Committees in Supervisory Boards of Polish Public Companies: Theory, Practice and Regulations

  • Agata Adamska
  • Leszek BohdanowiczEmail author
  • Jacek Gad
Part of the CSR, Sustainability, Ethics & Governance book series (CSEG)


The importance of audit committees increased after a wave of fraud which took place at the turn of the twentieth century. The audit committees were implemented into the corporate governance practice through guidelines, successively adopted in individual EU countries, codes of good practice, as well as legislative changes. The main premise of the legislative changes was the improvement of the process of supervision over the functioning of companies, including in particular public companies. The most important objective of establishing audit committees was to improve the efficiency of supervision of supervisory boards over financial and non-financial reporting of companies through better use of council members’ competences, better organization of its work and strengthening its position vis-à-vis the management board, shareholders and other stakeholders.

Initially, audit committees in Poland were appointed by companies on a voluntary basis, based on the recommendations of good practice codes, i.e., Dobre praktyki w spółkach publicznych 2005 [Good Practices in Public Companies 2005] and Dobre Praktyki Spółek Notowanych na GPW (2007) [Best Practice of WSE Listed Companies (2007)]. In 2009, the provisions of the EU Eighth Directive were implemented into Polish law, and thus the Act of May 7, 2009 on auditors and their self-government, entities authorized to audit financial statements and public supervision introduced the legal obligation to create audit committees also in public companies. The Act specified that the audit committee should consist of at least three board members, at least one of whom should meet the independence criteria and be qualified in the field of accounting or financial auditing. In 2017, the Polish legislator decided, in accordance with the solution provided for in the Directive 2014/56/EU of the European Parliament and of the Council, that the size of the board will not be the criterion for appointing an audit committee, but different size criteria for the company. Thus, supervisory boards do not have to appoint an audit committee if the company does not exceed two of the three criteria, i.e., revenues of PLN 34 million, assets worth PLN 17 million and employment of 50 employees.

This article concerns one of the key mechanisms of corporate governance, i.e., the activity of the audit committee. The purpose of this article is to present the evolution of Polish solutions regarding the activities of audit committees, resulting from good practices and statutory regulations, as well as the assessment of their implementation by companies.


  1. Abbott, L., Parker, S., & Peters, G. (2004). Audit committee characteristics and restatements. A Journal of Practice and Theory, 23(1), 69–87.CrossRefGoogle Scholar
  2. Aldamen, H., Duncan, H., Kelly, S., McNamara, R., & Nagel, S. (2012). Audit committee characteristics and firm performance during the global financial crisis. Accounting and Finance, 52(4), 971–1000.CrossRefGoogle Scholar
  3. Barka, H. B., & Legendre, F. (2017). Effect of the board of directors and the audit committee on firm performance: A panel data analysis. Journal of Management and Governance, 21(3), 737–755.CrossRefGoogle Scholar
  4. Beasley, M. (1996). An empirical analysis of the relation between the board of directors composition and financial statement fraud. The Accounting Review, 71(4), 443–465.Google Scholar
  5. Beattie, V., Fearnley, S., & Brandt, R. (2000). Behind the audit report: A descriptive study of discussions and negotiations between auditors and directors. International Journal of Auditing, 4, 177–202.CrossRefGoogle Scholar
  6. Bedard, J., Chtourou, S. M., & Courteau, L. (2004). The effect of audit committee expertise, independence, and activity on aggressive earnings management. A Journal of Practice and Theory, 23(2), 13–35.CrossRefGoogle Scholar
  7. Best Practices in Public Companies in 2002. Retrieved from
  8. Best Practices in Public Companies 2005. Retrieved from
  9. Birkett, B. S. (1986). The recent history of corporate audit committees. The Accounting Historians Journal, 13(2), 109–124.CrossRefGoogle Scholar
  10. Bosch Report. (1995). Bosch Report: Corporate practices and conduct (3rd ed.). Sydney: Pitman Publishing.Google Scholar
  11. Burke, F. M., Guy, D. M., & Tatum, K. V. (2008). Audit committees: A guide for directors, management, and consultants. Chicago: Wolters Kluwer business.Google Scholar
  12. Carcello, V., Neal, T. L., Palmrose, Z.-V., & Scholz, S. (2011). CEO involvement in selecting board members, audit committee effectiveness, and restatements. Contemporary Accounting Research, 28(2), 396–430.CrossRefGoogle Scholar
  13. Carson, E. (2002). Factors associated with the development of board sub-committees. Corporate Governance: An International Review, 10(1), 4–18.CrossRefGoogle Scholar
  14. Chan, K. C., & Li, J. (2008). Audit committee and firm value: Evidence on outside top executives as expert-independent directors. Corporate Governance: An International Review, 16(1), 16–31.CrossRefGoogle Scholar
  15. Colley, J. L., Jr., Doyle, J. L., Logan, G. W., & Stettinius, W. (2005). What is corporate governance. New York: McGrew-Hill.Google Scholar
  16. Collier, P. (1993). Factors affecting the formation of audit committees in major UK companies. Accounting and Business History, 23(1), 421–430.Google Scholar
  17. Collier, P., & Zaman, M. (2005). Convergence in European corporate governance: The audit committee concept. Corporate Governance: An International Review, 13(6), 753–768.CrossRefGoogle Scholar
  18. Committee on the Financial Aspects of Corporate Governance. The financial aspects of corporate governance (Cadbury report). London: Gee and Co.Google Scholar
  19. De Jong, A., De Jong, D. V., Mertens, G., & Wasley, C. E. (2002). The role of self-regulation in corporate governance: Evidence and implications from The Netherlands. Journal of Corporate Finance, 11(3), 473–503.CrossRefGoogle Scholar
  20. De Zoort, F. T., & Salterio, S. (2001). The effects of corporate governance experience and financial reporting and audit knowledge on audit committee members’ judgments. A Journal of Practice and Theory, 20(2), 31–47.CrossRefGoogle Scholar
  21. De Zoort, F. T., Hermanson, D. R., Archambeault, D. S., & Reed, S. A. (2002). Audit committee effectiveness: A synthesis of the empirical audit committee literature. Journal of Accounting Literature, 21, 38–75.Google Scholar
  22. Dobija, D. (2010). Komitet audytu a nadzór nad biegłym rewidentem. Praktyka polskich spółek giełdowych, Zeszyty Teoretyczne Rachunkowości, 59, 5–14.Google Scholar
  23. Dobija, D. (2011). Doświadczenia funkcjonowania komitetów audytu w Polsce. In D. Dobija, I. Koładkiewicz, I. Cieślak, & K. Klimczak (Eds.), Komitety rad nadzorczych. Warszawa: Wolters Kluwert Business.Google Scholar
  24. Dobija, D. (2013). Exploring audit committee practices: Oversight of financial reporting and external auditors in Poland. Journal of Management and Governance, 19(1), 113–143.CrossRefGoogle Scholar
  25. Du Plessis, J. J., & Low, C. K. (2017). Corporate governance codes under the spotlight: International perspectives and critical analysis. Cham: Springer.CrossRefGoogle Scholar
  26. Ferguson, N. (2008). The ascent of money: A financial history of the world. New York: Penguin.Google Scholar
  27. Jerzemowska, M., Campbell, K., & Najman, K. (2010). Przyczynek do oceny polskich regulacji nadzoru korporacyjnego. Master of Business Administration, 115(4), 2–15.Google Scholar
  28. Kallamu, B. S., & Saat, N. A. M. (2015). Audit committee attributes and firm performance: Evidence from Malaysian finance companies. Asian Review of Accounting, 23(3), 206–231.CrossRefGoogle Scholar
  29. Klein, A. (2002). Audit committee, board of director characteristics, and earnings management. Journal of Accounting and Economics, 33(3), 375–400.CrossRefGoogle Scholar
  30. Koładkiewicz, I. (2013). Rady nadzorcze – dobre praktyki ładu korporacyjnego: Doświadczenia polskie i zagraniczne. Warszawa: Poltext.Google Scholar
  31. Krishnan, J. (2005). Audit committee financial expertise and internal control: An empirical analysis. The Accounting Review, 80(2), 649–675.CrossRefGoogle Scholar
  32. Mangana, M., & Pike, R. (2005). The effect of audit committee shareholding, financial expertize and size on interim financial disclosures. Accounting and Business Research, 35(4), 327–349.CrossRefGoogle Scholar
  33. Menon, K., & Williams, J. D. (1994). The use of audit committees for monitoring. Journal of Accounting and Public Policy, 13(2), 121–139.CrossRefGoogle Scholar
  34. Oplustil, K. (2010). Instrumenty nadzoru korporacyjnego (corporate governance) w spółce akcyjnej. Warszawa: C.H. Beck.Google Scholar
  35. Pincus, K., Rusbarsky, M., & Wang, J. (1989). Voluntary formation on corporate audit committees among NASDAQ firms. Journal of Accounting and Public Policy, 8(4), 239–265.CrossRefGoogle Scholar
  36. Saleh, N. M., Iskandar, T. M., & Rahmat, M. M. (2007). Audit committee characteristics and earnings management: Evidence from Malaysia. Asian Review of Accounting, 15(2), 147–163.CrossRefGoogle Scholar
  37. Samaha, K., Khlif, H., & Hussainey, K. (2015). The impact of board and audit committee characteristics on voluntary disclosure: A meta-analysis. The Journal of International Accounting, Auditing, and Taxation, 24, 13–28.CrossRefGoogle Scholar
  38. Spira, L. F. (2003). Audit committees: Begging the question? Corporate Governance: An International Review, 11(3), 180–187.CrossRefGoogle Scholar
  39. Sultana, N. (2015). Audit committee characteristics and accounting conservatism. International Journal of Auditing, 19(2), 88–102.CrossRefGoogle Scholar
  40. Ustawa z dnia 7 maja 2009 r. o biegłych rewidentach i ich samorządzie, podmiotach uprawnionych do badania sprawozdań finansowych oraz o nadzorze publicznym, Dz. U. z 2009 r., nr 77, poz. 649 ze zm.Google Scholar
  41. Ustawa z dnia 11 maja 2017 o biegłych rewidentach, firmach audytorskich oraz nadzorze publicznym, Dz. U. z 2017, nr 0, poz. 1089.Google Scholar
  42. Verschoor, C. C. (1990). MiniScribe: A new example of audit committee ineffectiveness. Internal Auditing, 5(4), 13–19.Google Scholar
  43. Winter, J., Hopt, K. J., Rickford, J., Garrido Garcia, J. M., Rossi, G., Schans, C. J., & Simon, J. (2002). Report of the high level group of company law experts on a modern regulatory framework for company law in Europe, Brussels, 4 November.Google Scholar

Copyright information

© Springer Nature Switzerland AG 2020

Authors and Affiliations

  1. 1.Warsaw School of EconomicsWarsawPoland
  2. 2.University of LodzLodzPoland

Personalised recommendations